Citrix Systems’ US$500 million acquisition of XenSource, along with VMware’s massively successful IPO earlier this week, has further legitimatized the hot virtualization space, but it may also be causing some disillusionment among the open source community.

XenSource commercializes the open source Xen virtualization software, a free virtual machine monitor. It can be delivered as a virtualization platform, as found in the XenEnterprise product, or embedded in a host operating system, such as Novell’s Suse Linux Enterprise 10 or Red Hat’s RHEL 5/Fedora 7.

Gartner analyst George Weiss said that XenSource chief Peter Levine has to make a concerted effort in order to retain the loyalty of the open source Xen developers. Otherwise, he said, the open source community may look at the future of the Xen project destiny with too much uncertainty to continue supporting it.

“The possible downside here is the open source community might see that technology being co-opted by a larger conglomerate of proprietary company that may use the open source as a vehicle toward the financial gains and monetary rewards of this Citrix-XenSource company,” Weiss said.

Weiss said that the move could even cause companies such as Red Hat and Novell toward alternative technologies, such as Santa Clara, Calif.-based Qumranet’s Kernel-based Virtual Machine (KVM), a Linux kernel infrastructure for supporting virtualization.

“KVM now appears to be the only unaffiliated project for virtualization that isn’t beholden to any commercial organization,” Weiss said. “KVM is not dependant on anybody other than its own developers, and that’s the way XenSource would like Xen to appear. But if there’s any further gains by KVM, organizations will start to look to it as an alternative.”

Weiss said that both Citrix and XenSource have to continue to invite community participation and rewards to maintain the buildup for the Xen Hypervisor ecosystem in order to avoid that scenario.

But according to Novell Canada CTO/CIO Ross Chevalier, the acquisition will not jeopardize the Xen project. He said the acquisition reaffirmed its commitment that virtualization with Xen is an important tool for businesses and Novell will continue to have faith in the project.

“Our contribution from the word ‘go’ has been to the open source Xen project and that will be our whole and complete focus,” Chevalier said. “XenSource is now going to go build some stuff that will become licenced products using the Xen architecture and that’s great for them. But our commitment is to the Xen project.”

Chevalier also affirmed that Novell’s Suse Linux 10 wasn’t created in a vacuum or by any single vendor.

“The work we do becomes part of the community release, and if we do a great implementation of those tool sets and we provide great support, then that’s our value proposition,” Chevalier said. “But if you go closed, well then you’ve just got yet another propriety implementation.”

As for KVM, Chevalier said that Novell will continue to explore KVM as an option for its community release of open Suse.

“Because really that’s what contributing to the open source community provides,” Chevalier said. “If at some point KVM provides the right level of solution and we’re comfortable with that being a part of the commercial release, then we’re going to support that too. Our whole goal is to we don’t want to force customers into a box and limit freedom of choice.”

But Weiss pointed to last November’s Novell-Microsoft deal, in which the two agreed to collaborate on the development of some technologies – for example, trying to help Microsoft’s Windows, a proprietary operating system, work with Novell’s open source Suse.

“When this happened, there was a lot of disillusionment in the market and a lot of Suse developers left on principle that they wouldn’t work for a company that has these agreements with propriety vendors,” Weiss said.

Andi Mann, research director at Enterprise Management Associates, said he asked both XenSource and Citrix about the future of the open source project.

“They both stated to me that they are fully committed to maintain Xen as an open source project,” Mann said. “And I actually believe that this gives them a lot more resources to do this.”

Mann said that the Xen project’s biggest contributors were companies like Intel, AMD and Novell, and that the continued contribution from these enterprises will keep the Xen project strong.